Next Loan Payment Due: 6/28/2015
Day 186 | $67,506 paid | $23,211 till freedom
If nothing else, I've bought some time. Check it out--a snip of a screenshot from my homepage on the Federal Student Aid website.
I can wait over three years until I make my next student loan payment. I won't, of course, but it's pretty cool to see that I could if I wanted to.
Landscaping Business Shuttered
Michael and I gave two on-site landscaping consultations to a couple of potential clients several Sundays ago--it was in the middle of the cold, rainy day, and we were out in people's yards helping them design their landscapes. Including the commute, the whole ordeal took a few hours, and I had to cancel plans to do it.
After the on-site consultations, Michael and I then developed the formal quotes. He did the graphical designs and I costed them out in terms of materials and labor, then we sent the quotes over to the potential clients for review.
All in, I'd say we spent about six to seven hours each to build both quotes.
We took the pictures in the left column and included the pictures in the right column in the quotes.
Customer 1:
Customer 2:
They both replied back fairly quickly, expressing interest and asking follow-up questions to which Michael and I replied immediately.
We never heard back from the first client. The second one emailed us yesterday. Choice excerpt below:
Yes, I realize it is long term but I can't afford the big chunk of money right now. I understand the labor is extensive, and to haul away...I can appreciate & understand you have to make money. No doubt about that. However, I have to be smart, and stick to a budget regarding my yard. I have come up with other options..getting my supplies at Whittlesey in Round Rock and doing it myself with help from family & friends.
Whittlesey? Interesting...that's exactly where we get our supplies. So let me see if I'm understanding this correctly: We went out to her yard, spent an hour with her and her husband walking through our plans for how to design and xeriscape their yard, then sent them pics showing what we could do, along with a description and quantity of materials we would have to purchase, and they said thanks, but no thanks, we'll do it ourselves?
Sounds like in our zest to sell her on our services, we enabled her to hire cheaper labor and contract the job herself.
I'm trying to stay positive, but I feel robbed.
This was our fourth free quote we've given somebody with no return. I can't say for sure that all of our prospects have chosen to use our designs and hire cheaper labor on their own, but between the hours spent on providing fruitless quotes and the fact that I'm looking like I will meet this NMHD challenge on time, the weekend landscaping gig--if you can even call it a gig since we only did two jobs--has lost all of its luster.
Were we completely out of price position? Were we unprofessional? Was it obvious that we were amateurs, that this was a weekend job? Or were our quotes simply way too informational, making it too easy for the customer to contract the job themselves?
I called Michael up last night after getting that email, we talked it over, and agreed to shut down the business.
I don't regret any part of this experience. This business did generate a profit over its short lifetime, so there were no expensive lessons, other than the opportunity cost of my time, and even that time was well spent. I still remember how excited Michael and I were building the business--creating the site, putting up flyers, fielding customer calls, etc. There was a lot of energy and enthusiasm, and it was a lot of fun.
I've learned a lot. When I was shoveling dirt into a wheelbarrow after putting the finishing touches on the completed landscape of our first job, I got a sense of what it would be like to work for myself, and the feeling was AWESOME. I have no doubt I'll be back to try something else at some point.
Surplus Check
I got a $112 check yesterday from my mortgage company due to a surplus on my escrow. Killer! It offsets a decent chunk of the $255 ticket I got hit with last week.
Meet Andrew Schiff
A recent WSJ blog post introduces readers to Andrew Schiff, a New Yorker who thinks he has a problem: his $350k salary is making it hard for him and his family to get by. The article and accompanying video are simply fascinating.
Schiff lives in NYC and makes $350k/year as a marketer for his brother's Connecticut brokerage firm. Despite a salary that is high by almost all measures, he claims in an even more fascinating Bloomberg article about bonuses that he's struggling to make ends meet.
His version of "making ends meet" is renting a duplex in Brooklyn, paying the $32k/year tuition for his daughter's private school, and paying for his summer rental. (But hey, as he puts it, it's not like the summer rental is in St. Barts or anything.)
He feels frustrated because when he was growing up, it didn't require being super-rich to afford these kinds of things; he feels like he's been robbed of his dream.
Here's a clue, brother: cut back your expenses and/or get out of New York City! I lived in Hell's Kitchen for three months in 2008 and rented a 400 square-foot bedroom out of a woman's apartment for $1,100/month. Hardly affordable, especially compared to the $1,400 mortgage on my upgraded 2,000 sq ft 3bed/2bath Austin house that was built in 1998. And that figure includes property tax and insurance!
Yes, New York City is expensive. No, you can't afford everything you're currently trying enjoy. Quit your whining and get outta there, and/or cut out the summer rental and private school!
Hey, bud, I'd love to live in downtown Austin, but I can't afford a $400k+ 2-bedroom condo. So guess what? I guess I'll keep living in my shack in North Austin and try to get by.
This is the absolute epitome of keeping up with the Joneses. From the Bloomberg article: " “Could you imagine what it’s like to say I got three kids in private school, I have to think about pulling them out? How do you do that?”
Uh, gee, I don't know...swing by in a cab and pick them up?
The other article, the Bloomberg article, opens with Schiff standing on a highway in a traffic jam, screaming profanities. He explains, "I'm not Zen at all, and when I'm freaking out about the situation, where I'm stuck like a rat in a trap on a highway with no way to get out, it's very hard."
No, you're not Zen at all--not in the way that I try to be Zen, anyway.
And you say you feel like a rat in a trap on the highway during that traffic jam? I'm sure you do. But guess what? Even after you get out of that traffic jam, you're still a rat on a treadmill. Time to get off, dude.
The reporter adds his own commentary in terms of the negative public perception of Mr. Schiff: "Americans are generally still fine with people getting wealthy. What they don't tolerate is people making a salary that puts them near the 1% and complaining that it's not enough. What Americans resent is not the wealth...it's having a level of wealth and complaining it's not enough, especially in these tough times."
Ouch.
That reminds me of a post I revisited on my own blog recently: "My S2000 just died. Pic of the rides [Murano, motorcycle, and S2000] below. All are paid off, but as of this weekend, only two are operational. When I’m not riding my bike, I’ll have to drive that brown thing…ugh. This sucks."
That "brown thing" was my perfectly good Murano. Geez, talk about tone deaf. The WSJ reporter point out that while Schiff's comments are completely valid among his circle of friends--just as mine would be--the wider population doesn't share that same appreciation as his fellow Wall Street friends might. Likewise, based on a scathing comment I got, my complaint also rubbed some people the wrong way. I actually cringed at the post myself when I read it the other day, and that was before reading the Schiff article. I was clearly in another world when I wrote it.
Leading by Example?
I can now count two buddies of mine at work who have decided to accelerate their student debt paydown, and they attribute their newfound missions directly to me.
After I was done talking shop with a colleague at work, she asked me something completely unrelated--whether she should take the $400/month payment plan for 25 years or the $800/month plan for 10 years to pay down her $70k of student loans. Believe it or not, she was seriously considering the former plan. This question led to a conversation about how much she spends on her rent: $1,700/month to live in a single bedroom apartment downtown. Ouch.
I advised her to go rent a room out of a house and go with the $800/month plan. She didn't like that idea very much, saying that she was 28 and thought she had arrived--it wasn't "fair" that she should have to live with somebody else. "The thought of having to share a washing machine sickens me." I just laughed and shook my head when she made that comment.
I told her that I had gotten sick to my stomach thinking about the sacrifices I would have to make before I took the plunge in late August last year. With $67k down and $23k to go, though, I can almost see the freedom I'll have once I become debt-free. I did my best to paint this vision, this feeling for her.
She has some financial rehab to go through, but I think she's going to decide to do the $800/month plan.
Do you remember how I told you I'm in a WhatsApp chat group with my four closets friends here in Austin? Adnan sent this pic out over the wire a couple of weeks ago and told us he was thinking about trading in his Lexus for it. He even took the car home for the weekend, which is a tactic some dealerships use to close their toughest sales.
He told us he'd be financing a deecnt chunk of it, and he wanted our advice on whether to buy it or not. He said he's wanted a 911 ever since he was young, he didn't think he could have one once he starts a family, and he wanted to feel accomplished.
Everybody told him to go for it except for me. A lot of people aren't sold on early retirement--I'm still not sure I am--and they don't really want the concept shoved down their throats. So I didn't pull that card. I just told him he could always get it later when he's in a more financially stable situation (i.e., can pay cash for it).
I also told him that he didn't need a car to feel accomplished.
That was a couple of weeks ago, and he still hasn't bought the car. I don't know if it's because of what I said or because his girlfriend doesn't want him to get it, but he's held off so far and hasn't brought it up in awhile.
The latest hullabaloo in the chat group? Refinancing mortgages and going for 15-year notes. All four of my friends own their own homes (and live alone), and the latest buzz is that they know a mortgage broker who can refi them into a 15-year mortgage at a super-low rate.
Bravo, boys. Bravo. Now we're talking about some smart financial decisions. I'd probably be in on this, too, if I weren't in such a cash-poor position.
Now, one of the guys did mention the other day on WhatsApp that he's going to watch the Formula One race in Shanghai on 4/15 followed by trips to Hong Kong and Macau. So much for frugality! He did ask if anybody wanted to join him and nobody confirmed. I'm not going to get carried away and say my friends are turning into a bunch of frugal dudes, but it's definitely interesting to watch it all unfold.